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SCHEDULE 14-A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. ____)
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Wayne Bancorp, Inc.
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(Name of Registrant as Specified In Its Charter)
Lori M. Beresford, Muldoon, Murphy & Faucette
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(Name of Person(s) Filing Proxy Statement, if other than Registrant)
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WAYNE BANCORP, INC.
1195 HAMBURG TURNPIKE - P.O. BOX 933
WAYNE, NEW JERSEY 07474-0933
TEL. (201) 305-5500
FAX (201) 305-0604
PLEASE VOTE MANAGEMENT'S ENCLOSED WHITE PROXIES AND DO NOT
RETURN ANY OTHER COLOR PROXY YOU MAY RECEIVE FROM
THE SEIDMAN GROUP.
December 16, 1996
Dear Fellow Shareholder:
You may have received a letter from a group who has variously styled
themselves as the "Committee to Preserve Shareholder Value" or the "Committee to
Maximize Shareholder Value." We will refer to this "committee" as the Seidman
Group because that is exactly what it is. Lawrence B. Seidman is no stranger to
instigating costly proxy fights, having been involved in previous proxy fights
for the control of at least three other New Jersey community banks.
WHAT IS YOUR MANAGEMENT ASKING ITS SHAREHOLDERS TO VOTE
FOR?
o Your Board of Directors has sent detailed proxy material to you
asking for your approval of the Wayne Bancorp, Inc. 1996 Stock-Based
Incentive Plan (the "Stock Plan"). Your Board of Directors
unanimously recommends that you approve the Stock Plan, which the
Board firmly believes will (i) enhance the ability of Wayne Bancorp
to attract and retain qualified directors, management and key
personnel, and (ii) provide performance incentives to management by
ensuring that a significant portion of their compensation will be
dependent upon the future performance of our Company's stock.
IS THIS REQUEST UNUSUAL OR INAPPROPRIATE?
o Absolutely Not!
o Wayne Bancorp's Stock Plan complies with all regulatory requirements
and is substantially similar to the stock-based incentive
arrangements that have been adopted by virtually all savings banks
or savings associations which convert from mutual to stock form.
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IS WAYNE BANCORP'S MANAGEMENT BEING PAID EXORBITANT
AMOUNTS?
o Absolutely Not!
o Your Board of Directors has sought to keep cash compensation levels
for management reasonable. Your President currently is paid a salary
that is within the median range of salaries of CEOs of similarly
sized publicly traded thrifts in the Middle Atlantic region.
Salaries paid to other officers of Wayne Bancorp are also well
within the range for executives of similarly sized institutions in
the New Jersey area.1
o Do not let the Seidman Group's letter mislead you. Wayne Bancorp's
former President and CEO had been employed by Wayne for nine years
and the payments made to him were in settlement of contractual
retirement and severance benefits which existed prior to the
conversion. These benefits have no relationship to compensation for
"2 1/2 months of work" cited by the Seidman Group.
HOW HAS YOUR COMPANY PERFORMED SINCE WAYNE BANCORP WENT
PUBLIC?
o From the date of its initial public offering to December 6, 1996,
Wayne Bancorp's stock performance has appreciated 41% from its
offering price and significantly outperformed the S&P 500.
WAYNE BANCORP, INC.
COMPARATIVE STOCK PRICE ANALYSIS(2)
[GRAPH APPEARS HERE]
The data points depicted on the graph are as follows:
POINTS
<TABLE>
<CAPTION>
DATES WAYNE S&P
<S> <C> <C>
06/28/96 100.00% 100.00%
07/05/96 112.50% 98.59%
07/12/96 107.50% 96.90%
07/19/96 116.25% 95.78%
07/26/96 112.50% 95.36%
08/02/96 120.00% 99.35%
08/09/96 127.50% 99.29%
08/16/96 126.25% 99.76%
08/23/96 128.13% 100.03%
08/30/96 132.50% 97.77%
09/06/96 135.00% 98.33%
09/13/96 137.50% 102.05%
09/20/96 138.75% 103.03%
09/27/96 136.25% 102.90%
10/04/96 136.25% 105.79%
10/11/96 141.25% 105.67%
10/18/96 146.25% 107.20%
10/25/96 147.50% 105.71%
11/01/96 143.75% 106.14%
11/08/96 136.88% 110.22%
11/15/96 138.75% 111.25%
11/22/96 145.00% 112.92%
11/29/96 145.00% 114.17%
12/06/96 141.88% 111.54%
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1. Data obtained from SNL Executive Compensation Review 1995.
2. Base point for Wayne Bancorp, Inc. Stock represents the initial public
offering price of $10.00.
</TABLE>
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o For the three months ended September 30, 1996, Wayne Bancorp earned
$549,000 before the imposition of a one-time special assessment of
$1.0 million levied in connection with the legislation enacted to
recapitalize the Savings Association Insurance Fund ("SAIF"), which
was applicable to all SAIF-insured institutions, and a non-recurring
charge associated with the retirement of the Company's former
President and CEO.
WHO IS LARRY SEIDMAN AND WHAT EXACTLY IS THE SEIDMAN GROUP
SEEKING?
o Your Board believes you should be concerned as to exactly what the
Seidman Group is seeking and whether they have the same interests
for Wayne Bancorp as you have.
o You should know that for the last three months, Mr. Seidman has been
seeking to pressure Wayne Bancorp's Board to add two of his
hand-picked nominees to the Board.
o Mr. Seidman has not told you that after winning a proxy fight and
becoming Chairman of the Board of Crestmont Federal Savings and Loan
Association, Edison, New Jersey, he became the subject of an order
(OTS Order No. AP 95- 35) dated November 8, 1995 by the Office of
Thrift Supervision, of the United States Department of Treasury (the
"OTS"), the primary federal regulator of Wayne Bancorp's subsidiary
Wayne Savings Bank, FSB which, among other things, states that
"[t]he Acting Director [of the OTS] further finds. . . , that
Respondent [Seidman] violated a regulation and recklessly engaged in
unsafe and unsound practices in conducting the affairs of Crestmont,
and that the regulatory violation and unsafe and unsound practices
were part of a pattern of misconduct. . . ."
o On November 12, 1996, IBS Financial Corp, another holding company
for a New Jersey financial institution that Mr. Seidman has a
substantial stock ownership in, filed an action in the United States
District Court for the District of New Jersey for declaratory and
injunctive relief alleging, among other things, that members of the
Seidman Group have, in connection with their efforts to obtain Board
seats, been unwilling to comply with the disclosure requirements of
the federal securities laws.
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YOUR BOARD BELIEVES YOU SHOULD BE CONCERNED AS TO WHETHER
THE SEIDMAN GROUP HAS THE SAME INTERESTS FOR WAYNE BANCORP AS
YOU HAVE.
The Board of Directors of Wayne Bancorp, Inc. UNANIMOUSLY urges you to
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vote "FOR" the Stock Plan by COMPLETING, SIGNING, DATING and RETURNING ALL of
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Management's "WHITE" Proxy Cards (another is enclosed for your convenience) that
you receive and to return NOTHING to the "Seidman Group". Although each
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shareholder's vote can only be counted once, we have been advised to collect as
many individual cards as we can (from each of you) for security reasons.
We THANK YOU for your past and continued support.
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Very truly yours,
/s/ Harold P. Cook, III /s/ Thomas D. Collins
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Harold P. Cook, III Thomas D. Collins
Chairman of the Board Director
and CEO
/s/ Johanna O'Connell /s/ Richard Len
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Johanna O'Connell Richard Len
President and Director Director
/s/ David M. Collins /s/ Nicholas S. Gentile, Jr.
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David M. Collins Nicholas S. Gentile, Jr.
Director Director
/s/ Ronald Higgins /s/ Charles A. Lota
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Ronald Higgins Charles A. Lota
Director Director
/s/ William J. Lloyd
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William J. Lloyd
Director
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SOLICITATION OF PROXIES
The cost of soliciting Management proxies will be borne by the Company.
The Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable and appropriate expenses incurred by them in sending
Management proxy materials to the beneficial owners of Wayne Bancorp's Common
Stock. The Company has retained Regan & Associates, Inc., a professional proxy
solicitation firm, to assist in the solicitation of proxies for a fee not to
exceed $15,000, plus reimbursement of expenses not to exceed $10,000.
Approximately ten persons will be utilized by Regan & Associates, Inc. in such
solicitation. The total amount estimated to be expended in connection with this
proxy contest is $125,000, which excludes the amount normally expended in
connection with a solicitation for similar compensation plans in the absence of
a contest, and costs represented by salaries and wages of regular employees and
officers of the Company. Approximately $30,000 has been paid to date. In
addition to solicitation by mail, directors, officers and regular employees of
the Company and/or the Bank may solicit proxies personally, by telegraph, by
facsimile transmission or by telephone without additional compensation.
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- VERY IMPORTANT -
IF YOU HAVE ANY QUESTIONS ABOUT HOW TO VOTE "FOR" MANAGEMENT'S STOCK PLAN,
PLEASE CALL OUR PROXY SOLICITOR, REGAN & ASSOCIATES, INC. AT (800) 737-3426.
AS A "GENERAL" RULE, OUR "WHITE" PROXY SHOULD BE RETURNED ONLY IN THE
PREPAID ENVELOPE THAT WAS SUPPLIED TO YOU. IF YOUR SHARES ARE HELD BY A BROKER
OR BANK, IT IS NECESSARY THAT YOUR PROXY INSTRUCTIONS BE RETURNED TO THEM FIRST,
SO THAT THEY CAN ISSUE A VOTE ON YOUR BEHALF.
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